Warren's Kiddie Shoppe, Inc. v. Casual Slacks, Inc.

• Decision Date: 03 November 1969
• Docket Number: No. 3,44584,Nos. 44583,s. 44583,3
• Citation: 171 S.E.2d 643,120 Ga.App. 578
• Parties: , 7 UCC Rep.Serv. 166 WARREN'S KIDDIE SHOPPE, INC. v. CASUAL SLACKS, INC. KIDDIE SHOPPE, INC. v. CASUAL SLACKS, INC
• Court: Georgia Court of Appeals

Page 643

171 S.E.2d 643

120 Ga.App. 578, 7 UCC Rep.Serv. 166

WARREN'S KIDDIE SHOPPE, INC. v. CASUAL SLACKS, INC.

KIDDIE SHOPPE, INC. v. CASUAL SLACKS, INC.

Nos. 44583, 44584.

Court of Appeals of Georgia, Division No. 3.

Nov. 3, 1969.

Syllabus by the Court

1. Under the Uniform Commercial Code, evidence of course of dealing, usage of trade and course of performance is admissible to explain or supplement the written terms of a contract for the sale of goods.

2. Notice of breach of contract for the sale of goods must be given within a reasonable time after the goods are received and accepted by the buyer; the notice requires no formality and is adequate if it merely informs the seller that the transaction is claimed to involve a breach and thus opens the way for normal settlement through negotiation.

Defendants, retail merchants, both appeal from summary judgment in favor of plaintiff, a manufacturer, in suits on account.

Plaintiff's affidavits showed that on March 5, 1968 defendants placed orders with plaintiff for assorted teenage clothing and these orders called for delivery during 'June-Aug.' Plaintiff shipped these goods and thereafter received checks from both defendants. However, these checks reflected substantial deductions from the invoiced prices and therefore plaintiff refused to accept them and instead brought suit for the full amount of each account.

Defendants' affidavits showed substantially the following facts: The phrase 'June-Aug.' has a definite meaning in the teenage clothing trade-i.e., the largest shipment of the ordered merchandise is to be received in June with a substantially similar shipment in July, and the balance, which should represent approximately twenty percent of the total order, should arrive in August. In the trade, it is well known that the phrase 'June-Aug.' means the delivery just specified because this is the period during which parents purchase new clothes for their childrens' school year commencing in September. Plaintiff was well aware of significance of this delivery term when he entered into these contracts with defendants. Furthermore, defendants reminded plaintiff on a number of occasions prior to delivery that time was of the essence in these contracts for the reasons above stated.

In spite of this, no shipment whatever was received by defendants until August 15, 1968 and possibly some days later than this, and they were incomplete. Upon receipt of these first shipments, defendants immediately telephoned plaintiff's president and told him that because the goods had been received so late in the pre-school selling season, it would be necessary to mark them down from one-third to one-half off their usual retail price and possibly more in order to sell them at all. Defendants further informed plaintiff's president in these conversations that by reason of plaintiff's breach in the delivery term of the contracts and the resulting need to sell the goods below their usual retail price, defendants would each have to make an appropriate deduction from the invoiced price of the goods. Defendants later forwarded to plaintiff their checks reflecting these deductions along with letters of explanation.

Kelly, Champion & Henson, Jerome M. Rothschild, Columbus, for appellant.

Aaron Cohen, Columbus, for appellee.

HALL, Judge.

1. The plaintiff contends that parol evidence is inadmissible to explain the shipment term 'June-Aug.' because the term unambiguously meant that the goods could be shipped at any time during June and July and through August 31, while defendants contend that whether or not the term 'June-Aug.' is ambiguous, evidence of course of dealing and usage of trade is admissible to explain or supplement the written terms of a contract. The Uniform Commercial Code which governs contracts of the kind here involved supports defendants' contention. 'Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented (a) by course of dealing or usage of trade (109A-1-205) or by course of performance (109A-2-208); * * *.' Code Ann. § 109A-2-202

The above section was adopted by the Georgia Legislature verbatim from § 2-202 of the Uniform Commercial Code and therefore, in its application by the Georgia courts, the intentions of the drafters of the Uniform Commercial Code as evidenced in the official comments to the Uniform Commercial Code should be given due consideration. Comment 1 to § 2-202 of the Uniform Commercial Code states: 'This section definitely rejects: * * * (b) The premise...